Sony Lundy, a South Florida businessman, was charged with fraud earlier this month for allegedly having his employees cash their checks at a convenience store in order to skirt reporting requirements for workers’ compensation insurance.
Lundy, the owner of Paloma Construction Group, founded his business in April of 2018. It was stated that in June 2018, he purchased a workers’ compensation insurance policy based on an annual payroll of $78,000, which would require premiums of around $10,000 a year.
From then until June 2019, prosecutors allege that Lundy’s total payroll would have totaled more than $147,000. Additionally, Lundy would have been liable for an additional $119,000 in premiums based on the nearly $892,000 a contractor stated he paid Lundy’s firm. It is not currently known how the alleged fraud was exposed.
This is not Lundy’s first run-in with the law; he has two pending cases from February 2019 against him for similar conduct in Broward County court. The outcomes of those cases have yet to be seen, although they reportedly involve felony charges. As of last reports, he is out on $45,000 bond. It does not appear as though anyone else has been charged with wrongdoing in connection to the alleged scheme.
In Florida, there is a specialized Bureau of Workers’ Compensation Fraud that employs 21 detectives in locations around the state’s major cities, such as Pensacola, Tallahassee, Jacksonville, St. Petersburg, Fort Myers, and Fort Lauderdale. This bureau works in conjunction with the Florida Department of Business and Professional Regulation (DBPR), Internal Revenue Service (IRS), Department of Labor, and other relevant departments and law enforcement agencies to fight fraud.
Despite these safeguards, there is still an unfortunate amount of workers’ compensation fraud in the area. In a report covering July 2015 to June 2016, the Bureau of Workers’ Compensation Fraud identified more than 1,300 cases presented for prosecution, more than 1,100 arrests, and more than 1,000 successful prosecutions. However, these numbers pale in comparison to the more than 16,000 referrals received during that same time frame. Additionally, more than 73 shell companies and more than $196 million in fraudulent transactions were identified and addressed.
Workers’ compensation fraud is a serious issue impacting the state of Florida. Given the number of referrals and prosecutions, this is likely not the last time we will see criminal charges for alleged fraud, which is so common because of the high cost of workers’ compensation insurance. However, this insurance is vital to protect both employers and their workers in case of injury while on the job. Workers’ compensation insurance can provide funds for employee’s medical costs, lost wages, and other necessary compensation after a workplace injury.
The only way to ensure you do not run afoul of legal issues is to consult and experienced workers’ compensation attorney so that you are in compliance with the law at all times.
South Florida Workers’ Compensation Attorney
If you or your loved one was injured at a job site, you should hire an attorney. Contact us to set up a free initial consultation and work with one of South Florida’s most experienced workers’ compensation defense attorneys.
Sources: 21.11.19 Workers Compensation Fraud